Solvency Regulation and the Property-Liability "Insurance Cycle."

Ralph A. Winter ()

Economic Inquiry, 1991, vol. 29, issue 3, pages 458-71

Abstract: Fluctuations in the supply of property-liability insurance may be exacerbated by regulation. To limit insolvencies, regulators constrain insurers against writing an excessive quantity of insurance relative to net worth. Revenue is used as a measure of aggregate quantity. In a competitive market with inelastic demand, a constraint on the ratio of revenue to net worth yields a catastrophe process for price dynamics. Indirect evidence supports the argument that the current form of solvency regulation is destabilizing. Copyright 1991 by Oxford University Press.

Date: 1991
View citations in EconPapers

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:oup:ecinqu:v:29:y:1991:i:3:p:458-71

Ordering information: This journal article can be ordered from
http://www.oup.co.uk/journals

Access Statistics for this article

Economic Inquiry is edited by Preston McAfee

More articles in Economic Inquiry from Oxford University Press
Address: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK
Series data maintained by Christopher F. Baum ().